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Industrial Emissions Directive

Summary
Evaluation
Commission Proposal
Legal Act
Implementation

Overall state of play:

Evaluation finalised in 2020, SWD(2020)181, 23 September 2020¹
Commission proposal adopted on 5 April 2022, COM (2022)156²
Legal act pending in legislative procedure

State of play, main conclusions, outlook

The Industrial Emissions Directive (2010/75/EU) covers around 50 000 large industrial installations and livestock farms across the EU, and regulates in an integrated manner emissions to air, water and land, and the processes associated, via a “Best Available Techniques (BAT)” approach.

The evaluation finalised in 2020 assessed how the Industrial Emissions Directive has worked to date, including: the identification of BAT; whether it has the correct scope; and whether there are aspects that might need to be improved with regards to the Directive's effectiveness, efficiency or coherence with other EU legislation. The evaluation found that the Directive generally performs well as originally designed, and that it provides significant EU added value, since it ensures EU-wide consistent requirements to reduce industrial pollution, and to monitor and enforce these requirements, thus reducing internal market distortions. However, the evaluation also identified a number of areas for improvement.

Building on these findings and on the new policy ambition set in the European Green Deal, the Commission has prepared and adopted proposals to revise both the Industrial Emissions Directive (IED) and the European Pollutant Release and Transfer Register (EPRTR) supported by a comprehensive impact assessment³.

Estimated savings and benefit:

While it is difficult to compare quantitatively the costs and benefits associated with the Industrial Emissions Directive, stakeholders perceive the costs as small when compared to the EU-wide added benefits, especially considering that the preparation of the Best Available Techniques Reference (BREF) documents is a highly technical process, which demands EU-wide and international expertise to remain up-to-date.

Extensive consultations undertaken with industry and agricultural sectors, with environmental civic society NGOs, Member States’ competent authorities and ministerial representatives, academia and individuals have shown that stakeholders widely and highly appreciate the benefits of the inclusive, thorough and transparent mechanism to develop BAT and BREF documents.

Fit for Future Platform

The Fit for Future Platform adopted an opinion (link) with suggestions on how to improve the Industrial Emissions Directive and its implementation.

Concerning the suggestion on increased digitalisation for the authorisation and control phases, the Commission deems that an EU level common electronic permit is probably not feasible given the diversity of national approaches. However, the Commission proposal puts forward a requirement for a harmonised digital permit summary for which the Commission would establish a common format. Moreover, the IED revision clarifies that the results of emissions monitoring are accessible on-line.

On monitoring provisions, their improvement is included in BAT conclusions and ensuring their consistent application will be discussed as part of the future revision of the BREF guidance.

Building on views from some industrial stakeholders about the burden stemming from the requirement, as formulated by some competent authorities, to produce baseline reports on soil and groundwater pollution, the Platform points to the need for further guidance. The Commission considers that the existing guidance is appropriate. However, the Commission is committed to reviewing the implementation of the provisions on the soil baseline report to ensure better compliance by the Member States.

On the suggestion pointing to overlapping requirements, the Commission considers that the problem is due to the lack of BAT conclusions for some directly associated activities rather than the wording of Annex I that defines the sectoral scope of the IED. Nonetheless, the Commission will consider this issue as part of future BREF reviews.

When it comes to the functioning of the BREF process, the proposal aims at modernisation and improvement of the BREF process, including data collection and processing methods. In particular, the processing of confidential business information (CBI) is the subject of agreements within each Technical Working Group undertaking the revision of a BREF. The Commission proposal provides for establishing clear legal rules on the processing of CBI.

Regarding clarity and harmonisation, the IED’s approach to permitting of individual facilities has proven to be effective, also in light of related provisions such as the definition of operators and the combination of permits. Moreover, the Commission proposal will promote more consistent and proportionate approaches across Member States, i.e. the proposal sets up harmonised rules to assess plants’ compliance with their permits, thereby the IED will promote a more level playing field, and reduce any territorial divergence of environmental performance of industry across Member States.

On the global dimension, both the evaluation and the impact assessment have looked into competitiveness aspects and no significant impacts were identified. The EU’s IED BAT approach is seen as best practice internationally, with many third countries working towards adoption of similar approaches or standards at national level. To support such dynamics, the Commission has posted all BAT Conclusions on the web in all UN languages and is funding an OECD project that organises exchanges of good practices on BAT and publishes authoritative reports that showcase the EU approach.

¹ https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=SWD:2020:0181:FIN:EN:PDF

² file:///C:/Users/kiciama/AppData/Local/Temp/1/COM_2022_156_1_EN_ACT_part1_v7.pdf

³ https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12306-EU-rules-on-industrial-emissions-revision

State of Play:

Evaluation finalised on 23 September 2020, SWD(2020)181

Scope:

Industrial Emissions Directive (2010/75/EU)

Evaluation findings

The evaluation found that the Directive has been effective in reducing environmental impacts and competitive distortions in the EU. The collaborative process for producing Best Available Techniques Reference documents (BREFs) and identifying Best Available Techniques (BAT) has worked well and is recognised as a model of collaborative governance.

The Directive has led to substantially reduced pollutant emissions to air and, to a lesser degree, to water. It has minimised emissions to soil from installations covered by the Directive. Its impacts on resource efficiency, the circular economy and innovation are harder to assess: it appears to have made a positive contribution of limited magnitude. Other aspects, such as public access to information and access to justice, have somewhat improved.

The Directive is largely efficient. The benefits of BAT conclusions substantially outweigh costs. No disproportionate or unnecessary administrative costs have been identified. There are mixed impacts on EU competitiveness but no evidence shows these would be significant.

All stakeholder groups consider the Directive relevant. It can respond to emerging environmental issues, despite the length of the BREF process. While the Directive has not contributed greatly to decarbonisation, views diverge about whether it is relevant for this.

The Directive is coherent internally and with other EU policies, however there is Scope for greater contribution to those. Some interpretation challenges require clarification.

The Directive provides significant EU added value. It ensures more consistent requirements to reduce industrial pollution, in addition to associated monitoring and enforcement activities to achieve these ends, thus reducing internal market distortions. Absence of EU action would have led to less demanding standards and less health and environment benefits. The BREF process is not replicable by individual Member States and is increasingly used by third countries. The Directive’s decentralised approach is consistent with the subsidiarity and proportionality principles.

The evaluation identified a number of areas where the Directive’s performance does not appear to be as satisfactory as desired, or where its targets do not precisely match the new policy objectives set out in the European Green Deal. These are most notable with regard to the Zero Pollution ambition for 2050, the relationship of the Directive to reducing the effects of climate change, the potential for synergies with new value chain proposals contained in the 2020 Circular Economy Action Plan, and the need to foster environmentally favourable innovations during the transition to a carbon neutral, clean and circular economy.

State of play

Adopted by the Commission on 5 April 2022, COM(2022)156.

Which objective(s) does the Commission pursue?

Building on the evaluation findings, the initiative aims to address five problems:

• Insufficient and inconsistent implementation of emission limits for air and water pollutants.

• Poor uptake of innovation due to BAT reliance on well-proven techniques.

• Little contribution to resource efficiency, Circular Economy and use of less toxic chemicals.

• The contribution to EU climate policy lacks coherence and is limited.

• Limited and outdated sectoral Scope of the legislation.

A package of preferred policy options and sub-options addresses each problem:

• Effectiveness: 24 measures ensure greater homogeneity of implementation and level of ambition across Member States, controlling flexibility on emission limit values; enhancing public rights and enforcement, and clarifying the legislation.

• Innovation: Frontrunners will have freedom to test novel techniques. An Innovation Centre for Industrial Transformation and Emissions will incorporate innovative technologies into BAT considerations and a review of permits by 2030 incorporates an operator’s Transformation Plan.

• Resource use and chemicals: Sector-specific Circular Economy, resource efficiency and reduced toxicity are fostered via more responsive mandatory Environmental Management Systems. The E-PRTR will require reporting of resource use to allow monitoring and benchmarking of environmental performance improvements.

• Decarbonisation: Empowers bottom-up optimal technological sector-specific means of achieving depollution and decarbonisation, with binding energy efficiency requirements. A 2028 review of the IED - Emissions Trading System relationship will allow optimal synergies from 2030. The E-PRTR will employ more detailed GHG emissions reporting.

• Sectoral scope: Needs to be widened, principally in livestock rearing and certain growing activities, such as extractive activities and giga-factories manufacturing batteries. Overall benefits of the initiative outweigh costs considerably.

Estimated savings and benefits:

While it has not been possible to quantify all impacts: (i) an illustrative assessment of monetised health benefits for the main measure contained in the Effectiveness Option are €860–2 800 million p.a., with business CAPEX/ OPEX costs at c. €210 million p.a.; and (ii) wider coverage of livestock farms results in methane and ammonia emission reductions with health benefits of over € 5 500 million p.a. and related compliance costs of c. €265 million p.a. The administrative burden increase is around €228 million p.a. for industrial operators and around €EUR 196 million p.a. for public authorities; this increase is substantially moderated by a lighter permitting system for livestock farms. Overall, the proposal establishes a legislative framework that equips the EU to address the significant environmental challenges expected in coming decades from agro-industrial activities.